Thursday, June 24, 2010

Part 2 -- What Is Strategy And What Are Strategic Decisions? (Teaching Strategic Intel Through Games)

Carl von Clausewitz, painting by Karl Wilhelm ...Image via Wikipedia

"As war is a game through its objective nature, so also is it through its subjective. -- Carl von Clausewitz, On War, Chapter 1.

While there are many definitions of "strategy" and "strategic decisions", for the purposes of this paper, a strategy is an idea or set of ideas about how to accomplish a goal and strategic decisions are ones that typically put at risk a substantial portion of an entity's disposable resources.

Defining strategy broadly is important.  Far too often, strategy is only associated with terms such as "long-term" or "large" and strategic thinking is something accomplished only at corporate headquarters or by generals and kings.

Defining strategic decisions in the context of the resources risked by the entity (person or organization) making the decision puts the role of strategy into perspective.  Under this definition, it is possible for the exact same decision to be strategic in one case and tactical (or even trivial) in another context. 

For example, imagine an individual who owns a successful dry cleaning store.  Deciding to open up another branch of the store in a different part of town is clearly a strategic decision for this owner.  This owner will likely spend many of his disposable resources (time, money, personnel) getting the new branch set up and operating efficiently.  Failure with this new branch would likely impact the old branch as well.

The same decision, to open another branch in the same town by the owner of a chain of 10,000 dry cleaning stores does not have the same strategic quality as in the first case.  In fact, such a decision, in such a large, national organization, might not even be made at the owner’s level.  The percentage of disposable resources placed at risk with this decision is likely much less and it is entirely possible that such a decision would be pushed down to regional or even sub-regional levels.

More importantly, defining strategy in terms of the resources at risk broadens the scope of what arguably constitutes strategic intelligence as well.   Under this definition, strategy is not confined to large, powerful organizations.  Small businesses, police units and even students can have strategies and, in turn, require strategic intelligence to support their decision-making processes.

What is intelligence and what is the role of intelligence in the formulation of strategy?
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jcb said...

I'm curious why you used the DOD definition of strategy in the context of your post. It seems that the last part of that definition, " achieve theater, national, and/or multinational objectives" could alter the application of your definition of strategic decision. If national/multinational objectives are of a concern in a strategy, it would imply that a strategic decision as you define it would put at risk a considerable amount of theater, national, or multinational assets and shouldn't be applied to an echelon lower than that.

I'm not adverse to how you define your problem set at all, since I agree that a small business can have a strategy and make strategic decisions that do risk a significant amount of resources. Just wondering if the DOD definition is not appropriate for your starting point.


Kristan J. Wheaton said...


Good question, thanks!

I linked the word strategy in the post to the DOD definition as a way of demonstrating "heavy influence" (in the sense a musician uses that word) rather than "total agreement". No real way to show that with just a link (probably should make it a more extensive footnote and will do so in the next draft).

That said, most definitions of strategy I ran across in my research (that also influenced my definition) seemed consistent in whole or part with my simplified version. Likewise, I know that military people below the theater, national or multinational level also formulate "strategies".

So, to answer your question more directly, no I don't think the influence of the DOD definition on my definition requires me to define strategy as something that happens at the national or higher level.

What I was trying to do was look at strategy from the decisionmaker's -- any decisionmaker's -- point of view. From that perspective, the small business owner, the local precinct captain and the battalion commander are all going to have "strategies" which will decisively impact their lives if they succeed or fail.

I wanted a definition which would cover that range of decisionmakers. I wanted the young professionals in my class to be able to put themselves in the shoes of whatever decisionmaker they happen to be working for and recognize a "strategic" level problem whether it was the owner of a dry cleaning store expanding across town or an army moving across the globe.


jcb said...

That makes sense. Since you didn't "quote" the DOD description, I suspected that you really didn't want to equate your definition with the entirety of that one.

"Heavy influence" (like a musician)...I like that!